Lien on my house

[Bob L]

What is the name of your state (only U.S. law)? MN
My divorce decree reads as follows;
Petitioner shall be granted a lein against the property in the amount of $7,729, to be paid within 4 years from the date of entry of the judgment and decree, said lien shall be paid on a monthly basis in the amount of $300 each month. Said lien shall be payable with accumulated interest as follows: (a) If the household is sold for cash or refinanced, then the lien shall be payable in full. (b) in any event, the lien shall be payable in full no later then 4 years from the date of the entry of the judgement and decree. (c) Respondent shall be solely responsible for all mortgage payments, taxes, insurance, and maintenance on the property, from the date of entry of the judgment in this matter and agrees to indemnify and hold petitioner harmless from any such expences. (d) both parties shall cooperate in signing any deeds or other conveyancing documents. If either falls to do so, recording the summary real estate disposition judgement will operate to transfer title.

I lost my job and was out of work for 6 months. In that time she said I didn't have to pay the payment. Now she wants to collect on what I didn't pay in the 6 months. Also it was set up to pay off in 4 years because she had agreed that I would not have to pay monthly in order to pay for the house. The house is for sale, I'm trying to short sale. I was unable to make payments and I will either short sale or forclose. Will I have to pay the lien if I foreclose? Do I need to pay it up so it is current? Because it needs to be paid in 4 years do I need to make monthly payments?

 

[Ohiogal]

What is the name of your state (only U.S. law)? MN
My divorce decree reads as follows;
Petitioner shall be granted a lein against the property in the amount of $7,729, to be paid within 4 years from the date of entry of the judgment and decree, said lien shall be paid on a monthly basis in the amount of $300 each month. Said lien shall be payable with accumulated interest as follows: (a) If the household is sold for cash or refinanced, then the lien shall be payable in full. (b) in any event, the lien shall be payable in full no later then 4 years from the date of the entry of the judgement and decree. (c) Respondent shall be solely responsible for all mortgage payments, taxes, insurance, and maintenance on the property, from the date of entry of the judgment in this matter and agrees to indemnify and hold petitioner harmless from any such expences. (d) both parties shall cooperate in signing any deeds or other conveyancing documents. If either falls to do so, recording the summary real estate disposition judgement will operate to transfer title.

I lost my job and was out of work for 6 months. In that time she said I didn't have to pay the payment. Now she wants to collect on what I didn't pay in the 6 months. Also it was set up to pay off in 4 years because she had agreed that I would not have to pay monthly in order to pay for the house. The house is for sale, I'm trying to short sale. I was unable to make payments and I will either short sale or forclose. Will I have to pay the lien if I foreclose? Do I need to pay it up so it is current? Because it needs to be paid in 4 years do I need to make monthly payments?

You owe the money. If you try to short sale SHE NEEDS TO RELEASE THE LIEN or the house will NOT be sold with clear title and no one will want to buy it.

 

[nextwife]

A lender will NOT allow the borrowers to pay themselves money out of closing on a short sale (to pay off the lien). The lender will not agree to a short sale that pays out money to one of the borrowers while the mortgage payoff is short. They also review bank statements and histories, so will look askance at any recent transactions that pay HER off (a debtor on their loan) a lump sum in advance of a sale that is short on the mortgage. Both borrowers owe the bank FIRST, before the lender is likely to agree to start being short.

 

[Ohiogal]

A lender will NOT allow the borrowers to pay themselves money out of closing on a short sale (to pay off the lien). The lender will not agree to a short sale that pays out money to one of the borrowers while the mortgage payoff is short. They also review bank statements and histories, so will look askance at any recent transactions that pay HER off (a debtor on their loan) a lump sum in advance of a sale that is short on the mortgage. Both borrowers owe the bank FIRST, before the lender is likely to agree to start being short.

Well looks like he won't be doing a short sale. Also looks like if he allows the bank to foreclose, that he may end up with a contempt motion and paying his ex a lot of money.

 

[nextwife]

He needs two or so roommates and to keep the mortgage current until the lien is paid off. IT cannot be paid out from the short sale, nor will his lender likely agree to a short sale if he just took any available funds and paid out a sum to a co-debtor, instead of toward the property.

 

[Ohiogal]

He needs two or so roommates and to keep the mortgage current until the lien is paid off. IT cannot be paid out from the short sale, nor will his lender likely agree to a short sale if he just took any available funds and paid out a sum to a co-debtor, instead of toward the property.

And with a lien on the property that prevents it from gaining clear title. Plus a short sale would hurt his ex's credit and he is to hold her harmless -- which means if he damages her credit and costs her money, he gets to pay it all. Which means he is digging a big old hole for himself and is stuck until he can pay the lien completely.

 

[Bob L]

Do I need to make the payments current to her and pay every month even if the decree reads that it has to be paid within 4 years? Does the 4 years mean anything?

 

[Ohiogal]

Do I need to make the payments current to her and pay every month even if the decree reads that it has to be paid within 4 years? Does the 4 years mean anything?

Yeah. The four years is by which time you MUST HAVE IT PAID IN FULL. She may have given you some months off but that doesn't mean she agreed to you missing the 4 year deadline. Which means you can be found in contempt if you go beyond that.

 

[mistoffolees]

And with a lien on the property that prevents it from gaining clear title. Plus a short sale would hurt his ex's credit and he is to hold her harmless -- which means if he damages her credit and costs her money, he gets to pay it all. Which means he is digging a big old hole for himself and is stuck until he can pay the lien completely.

There is one option that isn't ideal. If he could get her to release the lien and agree to accept payments from him in the future, he could then do a short sale.

Of course, there are two problems with that:
1. She'd be foolish to do that (although if he offers her something of GREATER value, she might go along)
and
2. As you point out, he must hold her harmless wrt her credit rating. However, that part is somewhat difficult to enforce. How do you put a financial value on someone's credit rating to assess damages.

Still, it's probably a lousy idea.

Do I need to make the payments current to her and pay every month even if the decree reads that it has to be paid within 4 years? Does the 4 years mean anything?

Simple. Court orders mean exactly what they say. If the court order says it must be paid off in 4 years, then it must be paid off in 4 years.

He needs two or so roommates and to keep the mortgage current until the lien is paid off. IT cannot be paid out from the short sale, nor will his lender likely agree to a short sale if he just took any available funds and paid out a sum to a co-debtor, instead of toward the property.

That's really the best option. Whether it's finding a roommate, getting a second job, selling personal possessions (although this could be a problem with the bank) or whatever, he needs to find a way to satisfy the debt.

That still leaves the problem with him damaging ex's credit rating and having to hold her harmless, but that one doesn't get enforced all that often. Hopefully, if he holds on for 4 years while paying off ex's debt and continuing to pay the mortgage, it may no longer be a short sale.

 

[Bob L]

Maybe I'm not asking the question right. It will be paid in 4 years no problem. I have paid $3000 of it in 14 months. Even with missing 5 months of the $300 a month payment. She is telling me I'm in contempt of court and threatening me because it is behind by a few months. Is she correct or is the 4 year time frame more critical than the $300 a month?

 

[mistoffolees]

Maybe I'm not asking the question right. It will be paid in 4 years no problem. I have paid $3000 of it in 14 months. Even with missing 5 months of the $300 a month payment. She is telling me I'm in contempt of court and threatening me because it is behind by a few months. Is she correct or is the 4 year time frame more critical than the $300 a month?

Your order says "said lien shall be paid on a monthly basis in the amount of $300 each month. "

If you haven't paid $300 each and every month, then you're in contempt. Saying that you'll meet ONE of the statements in your order doesn't excuse you from having to meet ALL of them. In 14 months, you should have paid $4200 and you've only paid $3000.

Better find a way to get caught up.

 

[HomeGuru]

Maybe I'm not asking the question right. It will be paid in 4 years no problem. I have paid $3000 of it in 14 months. Even with missing 5 months of the $300 a month payment. She is telling me I'm in contempt of court and threatening me because it is behind by a few months. Is she correct or is the 4 year time frame more critical than the $300 a month?

**A: she is correct. READ the court order again. Is there a provision that allows you to miss one month let alone 5 months?